The rupee edged higher by 7 paise to 66.52 against the dollar on Tuesday on increased selling of the American currency by exporters and banks ahead of RBI policy meet scheduled later in the day.
Forex dealers said a higher opening of the domestic equity market supported the rupee, but strength in the dollar against other currencies overseas backed by improving prospects of a US rate hike capped the gains.
On Monday, the rupee strengthened by 2 paise to close at 66.59 against the dollar on mild selling of the American unit by banks and exporters.
Meanwhile, the benchmark BSE Sensex was up 159.36 points, or 0.56 per cent, at 28,402.65 in early trade.
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